Bombardier cut­ting 5,000 jobs — mostly in Canada — in re­struc­tur­ing

The Daily Press (Timmins) - - NATIONAL NEWS - CHRISTO­PHER REYNOLDS

MON­TREAL — bombardier inc. an­nounced Thurs­day it will shed 5,000 jobs com­pany-wide and sell off two units as part of chief ex­ec­u­tive alain belle­mare’s five-year plan to rein in costs, fo­cus on rail and busi­ness jets and re­duce the net longterm debt of $9 bil­lion.

about 2,500 bombardier work­ers will be laid off in Que­bec and 600 in on­tario, with the 2,000 other cuts oc­cur­ring over­seas, ac­cord­ing to a spokesman, who did not spec­ify the units.

The com­pany said it will sell its Q400 tur­bo­prop air­craft pro­gram to a sub­sidiary of longview avi­a­tion Cap­i­tal Corp. for about $395 mil­lion. The mon­treal-based com­pany also an­nounced the sale of its flight train­ing busi­ness to Cae inc. for about $850 mil­lion.

The re­struc­tur­ing, an­nounced along­side bombardier’s third-quar­ter earn­ings, is slated for com­ple­tion within 18 months and for sav­ings of $250 mil­lion an­nu­ally.

The an­nounce­ment comes af­ter mass lay­offs over the past three years, with about 14,500 po­si­tions cut around the world in the aerospace and rail­way di­vi­sions.

drop­ping the Q400 will al­low bombardier to zero in on pro­duc­ing its Global se­ries of long-range busi­ness jets, in­clud­ing the Global 7500, whose first air­craft is slated for de­liv­ery next month.

“With the mea­sures an­nounced, we are con­fi­dent that we will be able to reach our goals in 2020,” belle­mare said dur­ing a con­fer­ence call.

bombardier shares tum­bled by more than 20 per cent to $2.53 in mid-af­ter­noon trad­ing on the Toronto stock ex­change due to con­cerns over cash flow.

bombardier fore­cast 2019 rev­enue to in­crease by 10 per cent to at least $18 bil­lion, pow­ered by more de­liv­er­ies of its Global 7500s.

Free cash flow came in“well be­low” ex­pec­ta­tions that bombardier could break even on cash with­out fall­ing back on its $635 mil­lion in pro­ceeds from the sale of a Toronto plant ear­lier this year, said an­a­lyst benoit Poirier of des­jardins Cap­i­tal mar­kets.

“The new fa­cil­ity at Pear­son (air­port) will prob­a­bly be pro­duc­ing only the Global busi­ness jet, and hav­ing a ded­i­cated fa­cil­ity for one line gives them a chance to op­ti­mize the per­for­mance,” said ernie ar­vai, a part­ner at com­mer­cial avi­a­tion con­sul­tancy airin­sight.

“The next ques­tion for bombardier is what hap­pens with the CrJ line and what hap­pens with the rest of the com­mer­cial busi­ness.”

The fate of the ag­ing CrJ re­gional jets has been un­clear since the com­pany an­nounced in oc­to­ber 2017 that air­bus se would ac­quire a ma­jor­ity 50.01 per cent stake in the C se­ries, ef­fec­tive July 1 of this year.

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